Market worries and volatility will outlast summer
By Agnes T. Crane and Richard Beales
The authors are Reuters Breakingviews columnists. The opinions expressed are their own.
Investors who spent August on the beach were fortunate to miss a bout of rollercoaster trading. And they will be rested for the next round, a taste of which came on Friday. The concerns behind the last volatile patch still haven’t been addressed. European debt trouble, the weakness of U.S. economic growth — underlined by the zero jobs created in August — and political conflict spell more wild rides.
U.S. mortgage suits inflict super-damages on banks
(The authors are Reuters Breakingviews columnists. The opinions
expressed are their own)
By Margaret Doyle and Agnes Crane
LONDON, Sept 6 (Reuters Breakingviews) – Just when investors
in European and U.S. banks thought things couldn’t get worse, 17
financial institutions have been sued over $196 billion-worth of
toxic mortgage bonds. Bank shares fell up to 12 percent across
Europe with U.S. markets closed. But it’s hard to rationalise
the falls on the basis of the lawsuit alone.
Breakingviews-U.S. mortgage suits inflict super-damages on banks
(The authors are Reuters Breakingviews columnists. The opinions
expressed are their own)
By Margaret Doyle and Agnes Crane
LONDON, Sept 6 (Reuters Breakingviews) – Just when investors
in European and U.S. banks thought things couldn’t get worse, 17
financial institutions have been sued over $196 billion-worth of
toxic mortgage bonds. Bank shares fell up to 12 percent across
Europe with U.S. markets closed. But it’s hard to rationalise
the falls on the basis of the lawsuit alone.
More U.S. mortgage help isn’t needed
By Agnes T. Crane
The author is a Reuters Breakingviews columnist. The opinions expressed are her own.
There’s talk of yet more government help for careworn American mortgage borrowers. Washington has already made Herculean efforts. But there’s no magic bullet and returns are diminishing.
Texas governor unlikely small government champion
By Agnes T. Crane and Christopher Swann
The authors are Reuters Breakingviews columnists. The opinions expressed are their own.
Rick Perry, the latest U.S. presidential hopeful, has said he wants to make the federal government “inconsequential”. Yet as Texas governor he has presided over the creation of more government jobs per head of population than Washington. These and other new jobs have been good for Perry’s state. But their origin contradicts his small-government rhetoric.
Financial lifeboats starting to get crowded
By Agnes T. Crane
The author is a Reuters Breakingviews columnist. The opinions expressed are her own.
The financial lifeboats are starting to get crowded. Investors in droves have sought safety in Uncle Sam’s debt, and even bonds backed by American homes. But on Thursday, vessels of refuge showed how quickly they can be rocked when too many investors pile in.
Markets could force Fed to empty the chamber
By Agnes T. Crane
The author is a Reuters Breakingviews columnist. The opinions expressed are her own.
Markets could force the Federal Reserve to use up the rest of its arsenal. Although investors found comfort in the central bank’s stated “range of policy tools” on Tuesday, by Wednesday morning they had a change of heart. The slide could press Fed Chairman Ben Bernanke to fire sooner rather than later to keep recession at bay. Trouble is, he’s packing a BB gun not a bazooka.
Don’t blame S&P for the madness of markets
(The author is a Reuters Breakingviews columnist. The opinions expressed are her own.)
By Agnes T. Crane
NEW YORK (Reuters Breakingviews) – Don’t blame Standard & Poor’s for the madness of markets. The credit rating agency targeted U.S. debt, but it was stocks not Treasuries that got clobbered on Monday. The counterintuitive reaction, however, is less bonkers than it seems.
Timing of S&P U.S. downgrade couldn’t be better
By Agnes T. Crane
The author is a Reuters Breakingviews columnist. The opinions expressed are her own.
The Standard & Poor’s downgrade of the United States couldn’t have come at a much better time. Markets may be wobbly, but interest rates are at historic lows and buyers of U.S. debt are plentiful as the world braces for another economic slowdown. There may be some initial turbulence when investors return on Monday, but if the rating agency waited until markets acted first the consequences would be far more severe.
Plunging markets reflect ugly political paralysis
By Agnes T. Crane
The author is a Reuters Breakingviews columnist. The opinions expressed are her own.
Thursday’s market plunge reflects, as much as anything, an ugly political paralysis. This phenomenon, rather than any particular headline, seems to have freaked out investors, sending U.S. stocks down around 4 percent at one point, Treasury yields below 2.5 percent, oil under $90 a barrel and even gold off 0.5 percent. Politicians’ brinksmanship in Europe and the United States makes for great theater, but it has done little to resolve what most troubles the global economy: too much debt and no clear plan to pay it off.
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